(By Mike Raftery)
The beauty of a supply planner’s life is that (s)he is never expected to be 100% right. Think about it – who else gets paid so much for being wrong? (Insert terrible politician joke here. #makesupplychainsgreatagain) But let’s face it: a forecast is a guess that needs to be graded on a curve. And then throw in the inevitable curve ball we like to call “management.” Don’t even get me started on management. Those jerks! If they would only listen and open up the purse strings for more inventory, I’m sure we could meet those service targets. (Just explain it to Wall St that those targets were unachievable; they seem like a fairly easygoing bunch.)
Now it’s just you and a decent plan between your terrible forecast and your unforgiving customers; so go make it happen. The good news is that technology is getting better and you might just possibly have a fighting chance. The response and supply module of IBP shifts focus and adds flexibility to an ever changing supply chain. The best part is that it removes the barriers of technology and allows you to focus on the process. It’s scary, but that’s ok. Focus on the process that you need to get the job done, and you’ll be a hero.
Strategic Supply Planning – Mid-Long Term
The focus is on problem avoidance. See and avoid. This is group work. Make sure that everyone is involved in the problem solving and that you can address the issues as a group. The IBP functionality allows for easy what-if simulations, fast solutions and thorough collaboration. This makes it easy to develop scenarios, evaluate alternatives and share information. Get better solutions, and share it with the team and get to a decision faster than you did before. It’s better to avoid an issue before than explain after, isn’t it?
Here’s what you can do with IBP Response and Supply around strategic supply planning in the mid to long term.
- Strategic Planning – Review alternate sourcing for locations and customers. Evaluate capacity options and develop a plan that works.
- Optimization – Run models to derive least cost scenarios to uncover innovative plans to solve your toughest problems.
- What if Planning – Prove out theories and review multiple options for analysis by all required parties.
Operational Supply Planning – Mid Term
This is where the rubber meets the road. The strategy turns into execution. What does the inventory plan really look like? How much capacity is available today? Who’s sourcing which location? What do the transportation volumes look like? It’s also where issues first start to appear. Alerts highlight potential problem areas, and troubleshooting starts. Life happens and fixes need to start coming into view. Issue resolution is the key here: finding orders, making plans and projecting volumes. That’s how a plan turns into a PLAN. Here’s what you can do:
- Align strategic and operational direction – Use the strategic plans to develop orders to meet customer service and forecast targets.
- Prioritize demand types – When it’s just not enough, send what you have to the right place to minimize the cost to services.
- Position Inventory – Anticipate the problem and provide a solution. Get distribution of inventory to the right spot when your customers need it.
Response – Short Term, Customer Focused
The customer is always right. The customer’s plan? Not so much. So what do you do when an order shows up over here, and your inventory is over there? You adjust. That means making the best of a bad situation. Define your backup plans ahead of time, and the rest is just execution. Reduce that panic down to execution and now we’re working. Here’s how:
- Allocation – Prioritize customers, demand and locations to align inventory strategy with strategic priorities.
- Adjust Schedules – Make short term adjustments to make the most out of the least. Minimize the damage.
- Rule Based – Define the rules to build the plan ahead of time. Don’t panic, just execute.
Ready to see how this plays out? Get in touch with us. We’d love to chat. Or check out the other blogs in this series.